Weekly news, topics & discussion

This week, we published previews for most of our coverage universe. For Aker BP, we estimate solid Q1 production of 450kboed, with our EBITDA forecast 12% above consensus, ahead of the trading update on 7 April. For Vår Energi, we expect a slow start to the year, with Q1e production of 277kboed, leaving our EBITDA c7% below consensus, ahead of the trading update on 11 April. In other news, Johan Castberg reached first oil this week, with ramp-up expected through Q2 2025.

Crude Quarterly Q1'25: weaker oil market fundamentals

Estimate changes from Crude Quarterly, 3 April

Valuation update

In this note, we show updated valuation statistics for the E&P sector.

Aker BP (Buy, TP: NOK280.00) - Hitting the ground running

Supported by strong Q1e production of 450kboed, our EBITDA forecast is 12% above consensus (the Q1 trading update is due at 07:00 CET on 7 April). Consequently, following a stronger-than-expected start to the year, we have raised our full-year production estimate. We forecast 2025 production of 424kboed, exceeding the guidance (390–420kboed) and consensus (412kboed). The key production drivers are broadly flat YOY for Johan Sverdrup production, Edvard Grieg stabilising, and positive YOY for Tyrv...

Weekly news, topics & discussion

This week, we published a note on the harsh reality of USD70/bbl for our coverage. While investors appear to be positioning for lower oil prices, we believe consensus FCF estimates for NCS large caps remain overly aggressive. Meanwhile, DNO announced a discovery at the Kjøttkake prospect, north-west of Troll, adding ~NOK0.8/share (~4%) to DNO’s NAV and ~NOK1/share to Aker BP’s (

The harsh reality of USD70/bbl

Investors are positioning for lower oil prices, and the perception seems to be that cash flows are set to remain healthy and valuations attractive. We are concerned that overly aggressive consensus FCF facilitates this, as our USD70/bbl calculations imply a normalised FCF yield of only 6–8% for our coverage. With the European majors trading at a 2025–2027e FCF yield of c12%, we struggle to find an attractive risk/reward in large-cap NCS stocks, as the implied returns are negative c10–25% at peer...

Valuation update

In this note, we show updated valuation statistics for the E&P sector

Energy Morning - 25 March 2025

Weekly news, topics and discussion

This week, NCS February production was broadly in line with the NOD’s expectations, with total output flat MOM but down 2.4% YOY. Aker BP showed solid January production, while Equinor, Vår Energi, OKEA and DNO showed declines MOM. Halten East is now on stream, but its slow ramp-up limits Vår Energi’s 2025 uplift to ~5kboed, reinforcing the downside risk to its 330–360kboed guidance. Also, DNO successfully placed a new USD600m bond (8.5% coupon) to refinance DNO04 and for general corporate purpo...

NCS February production in line

The Norwegian Offshore Directorate’s (NOD) preliminary NCS figures for February showed liquids production of 1,938kboed (in line with its forecast) and gas production of 355mcm/d (3.8% above its estimate). Overall production was 4.17mmboed, flat MOM (1.8% above its forecast), but down 2.4% YOY. Company-wise, Aker BP reported solid production in January, while Equinor, Vår Energi, OKEA and DNO all reported production down MOM.

Valuation update

In this note, we show updated valuation statistics for the E&P sector.

Weekly news, topics & discussion

This week, BlueNord cut its Q1 production guidance by ~25% due to a breaker failure at Tyra, implying a 5% hit to 2025 guidance and likely delaying the first dividend from March to May. Following DNO’s Sval Energi acquisition, we upgraded OKEA to BUY (HOLD) and raised our target price to NOK23 (20). We believe historical NCS transaction multiples provide valuation support for OKEA. Meanwhile, the sector is down 10–20% since Brent peaked at USD82/bbl in mid-January, with scarce oil macro support ...

Valuation update

In this note, we show updated valuation statistics for the E&P sector.

Norva24 (Hold, TP: SEK36.50) - SEK36.50/share cash offer

Apax Funds (through Nordahl BidCo AB) announced a recommended cash offer of SEK36.50/share for all outstanding shares in Norva24. As the principal shareholders (representing c57% of the outstanding shares) have undertaken to accept the offer and as we see a low likelihood of a competing bid, we have downgraded to HOLD (BUY) and reduced our target price to SEK36.50 (37). We find the offer in line with our view of the company as a premium asset.

Looking for supportive macro data

Our coverage universe has traded ~10–20% lower since Brent oil price peaked at USD82/bbl in mid-January. Positive oil macro data remains scarce, while gas prices face potential downside risk if Russian pipeline flows partially resume. Implied valuations for Aker BP and Vår Energi broadly align with current oil prices, suggesting limited near-term upside potential to current share prices unless oil prices rise from today’s USD70/bbl level.

Weekly news, topics & discussion

This week,

Valuation update

In this note, we show updated valuation statistics for the E&P sector.

US shale: resilient growth in 2025e

Based on our Q4 survey of US shale companies, we expect continued efficiency gains, productivity improvements, and operational synergies from consolidation to drive ~5% YOY liquids production growth in 2025, broadly in line with 2024 levels. This is despite an estimated 5% YOY decline in capex, indicating that production is expanding steadily without a corresponding increase in activity. The combination of rising production and declining capex is likely to drive down breakeven levels, strengthen...

Energy Morning - 4 March 2025